Asia Pacific Airports Magazines, Issue 4, 2014

Asia-Pacific Airports magazine – Issue 4, 2014

The official publication of ACI Asia-Pacific www.aci-asiapac.aero

www.aci-apa.com The official publication of ACI Asia-Pacific

In focus: Cambodia’s airport system

Issue 4, 2014

Survey: Airport IT trends

www.aci-apa.com

Special report: China Plus: Environment & destination Borneo

Published by

ASIA-PACIFIC AIRPORTS MAGAZINE

VVV @BH @O@ BNL

6 View from the top Regional director, Patti Chau, reflects on a good year for ACI’s Asia-Pacific region and looks forward to a busy and exciting 2015.

8 News

3GD NƧ BH@K OTAKHB@SHNM NE "( RH@ /@BHƼ B

Issue 4, 2014

(RRTD VVV @BH @O@ BNL

2ODBH@K QDONQS "GHM@ /KTR $MUHQNMLDMS CDRSHM@SHNM !NQMDN

/TAKHRGDC AX

26 Fast and the furious

Joe Bates picks out some of the highlights of a new report that reviews the capital investment programmes of close to 100 Chinese airports.

33 Island life Justin Burns reports on China’s ambitious plan to build a new $4.2 billion airport in Dalian.

34 China news Justin Burns rounds up the latest news and developments from airports across China.

20 Investing in China

Airport development in China continues at a phenomenal pace with dozens of major projects set to be completed in the next year, writes Joe Bates.

2TQUDX HQONQS (3 SQDMCR

Justin Burns finds out more about Beijing’s planned new capacitybusting international airport.

13 Traffic trends On the eve of the 20th anniversary of operating Cambodia’s airports, CEO, Emmanuel Menanteau, talks to Joe Bates about booming passenger traffic, customer service and the next phase of infrastructure development.

(M ENBTR "@LANCH@Ĺ—R @HQONQS RXRSDL

24 Boosting Beijing

10 ACI Asia-Pacific news

14 Coming of age

VVV @BH @RH@O@B @DQN

www.aci-apa.com

CONTENTS

RH@ /@BHĆĽ B HQONQSR L@F@YHMD Ĺ” (RRTD

Asia-Pacific Airports

3GD NƧ BH@K OTAKHB@SHNM NE "( RH@ /@BHƼ B

3

4

ASIA-PACIFIC AIRPORTS MAGAZINE

CONTENTS 36 Playing to its strengths Martin Rivers finds out more about the business strategy, growth and development plans of Cebu Pacific.

39 Putting people first The 2014 Airport IT Trends Survey reveals that China’s airports are increasingly focusing on the passenger experience.

42 Design & build Suvarnabhumi and Newcastle.

Asia-Pacific Airports (APA) www.aci-apa.com Editor Joe Bates +44 (0) 20 8831 7507 joe@aci-apa.com Reporter Justin Burns +44 (0) 20 8831 7508 justin@aci-apa.com

APA Issue 4, 2014

46 Environment news

48 Beautiful Borneo Tourism chief, Dato Rashid Khan, tells Asia-Pacific Airports about Sarawak’s five-year air service development plan.

52 World Business Partners 54 Points of view Nok Air CEO, Patee Sarasin, shares his views on the Thai aviation market, airport development and the 2015 launch of new joint venture NokScoot.

Design, Layout & Production Andrew Montgomery andy@aci-apa.com

Advertising Manager Kalpesh Vadher +44 (0) 20 8831 7510 kalpesh@aci-apa.com

Mark Draper

Andrew Hazell +44 (0) 20 8831 7518 andrewh@aci-apa.com

Website & Online José Cuenca Published by Aviation Business Media Ltd 91-93 Windmill Road, Sunbury-on-Thames TW16 7EF, UK Managing Director Jonathan Lee

Subscriptions Charlotte McCormack subscriptions@ aviationmedia.aero Printed in the UK by Magazine Printing Co

Asia-Pacific Airports (APA) is published four times a year for the members of ACI Asia-Pacific. The opinions and views expressed in APA are those of the authors and do not necessarily reflect an ACI policy or position.

The content of this publication is copyright of Aviation Business Media and should not be copied or stored without the express permission of the publisher.

Organiser

Host

ASIA-PACIFIC

ASIA-PACIFIC

10TH ACI ASIA-PACIFIC REGIONAL ASSEMBLY Conference & Exhibition APRIL 27-29, 2015 DEAD SEA, JORDAN

CONTACT Event enquiries ACI-Asia PaciďŹ c events@aci-asiapac.aero +852 2180 9449

Sponsorship & Exhibition Kalpesh Vadher kalpesh@aci-apaa2015.com +44 (0) 20 8831 7510

www.aci-apaa2015.com Exhibition organiser

Media partners

6

ASIA-PACIFIC AIRPORTS MAGAZINE

VIEWPOINT

VIEW FROM THE TOP

Regional director, Patti Chau, reflects on a good year for ACI’s Asia-Pacific region and looks forward to a busy and exciting 2015.

A

s we move towards the holiday season and the end of 2014, I am pleased to look back at what I believe has been a year of accomplishments for the Regional Office.

The past year has indeed been a time of change and growth for our region as reflected in our growing membership both in terms of airports and World Business Partners and our strengthened relationship with ICAO, IATA and other aviation organisations.

I am also glad to report that the reputation of ACI’s array of training programmes, seminars, summits and various environmental, customer service and human resources initiatives have been enhanced as they continue to gain momentum amongst members.

I have made a number of trips in recent months. Some were due to the various ACI events and some were to support the regional stakeholder outreach programme initiated by ACI World.

BUSINESS PLAN

In October, we had our Regional Board Meeting and the Small and Emerging Airports Seminar in Bali, Indonesia.

This was the first time the board had met since the May election of new ACI Asia-Pacific president, Dennis Chant, in Seoul, so it was good to get down to business and have the APA Issue 4, 2014

full support of Dennis and the Regional Board for our 2015–2017 Business Plan.

For my part, I undertake to continue to build the Regional Office’s capacity and serve our airports community with the goals we have developed in the Business Plan. I look forward to sharing more details of the plan with you in the near future.

SIZE MATTERS

I am glad to say that the Small and Emerging Airports Seminar, with fantastic support from Angkasa Pura Airports, was a great success.

A significant portion of our members are small and emerging airports, of course, and we very much value their contributions to the industry. After all, no matter how large or small an airport, each serves a key role in their city’s and in some cases country’s respective transportation infrastructure and economic development.

The Small and Emerging Airports Seminar is dedicated to addressing the common interests and concerns of this airport group in the Asia-Pacific region.

PASSAGE TO INDIA

As the voice of the world’s airports, ACI’s role is to help our members advance their common interests. It is therefore important to reach out and establish relationships with regulators and

ASIA-PACIFIC AIRPORTS MAGAZINE

OUTREACH PROGRAMME

In September our team further reached out to Beijing and Manila, meeting with a number of representatives from both the private sectors and institutes. Such initiatives have a long history of success as they allow us to engage with our stakeholders to make our voice heard. We aim to reach out to even more countries in our region in 2015.

AIRPORT EXCHANGE

In November, we once again jointly organised the Airport Exchange conference with ACI Europe, and the three-day event in Paris was a huge success.

We have always attached great importance to fostering closer ties with Europe and therefore we very much appreciate this co-organised event. The event was an opportune time to share an overview of the latest regional trends with our European colleagues. I also highlighted the phenomenal growth of the low-cost carrier market over the last decade, my views about the ASEAN Open Skies agreement and concerns on the airport capacity issue.

ENVIRONMENT

Our partnership with ACI Europe is, of course, not just limited to events, as the success of the ACI Europe launched Airport Carbon

Accreditation programme in our region demonstrates. I would even go as far as to say that the only institutionally endorsed carbon-management certification standard for airports has really engaged and motivated members across our region, as in just three years, we already have 21 airports accredited.

As well as welcoming new airports into the programme, we look forward to witnessing more accredited airports moving up through the levels of the programme. Together we will create a low-carbon airport industry.

SECURITY

In October, ACI, Melbourne Airport, Qantas and IATA signed an agreement to work together to develop a ‘smart security’ pilot programme for delivery at the Australian gateway in 2015.

‘Smart security’ is a joint project between IATA and ACI designed to bring different stakeholders together to facilitate the development of more efficient, sustainable and passenger-friendly screening solutions for passengers.

We believe that this can be achieved by focusing resources based on risk, using advanced security screening technologies and promoting innovations in the process.

Melbourne Airport becomes the fourth gateway to take part in the project, following in the footsteps of Amsterdam Schiphol, London Heathrow and Doha’s Hamad International Airport.

I am glad another airport in our region has committed to a more streamlined security process at their airport and we are confident that the programme will ultimately benefit the travelling public.

AND FINALLY…

Looking ahead to 2015 the events calendar is already beginning to fill up, so with this in mind, I invite you to join us in London for our first event of the year – the seventh Airport Economics & Finance Conference on February 25–27. I look forward to seeing you there!

And finally, as this is the last issue published in 2014, I would like to wish you all a very happy New Year and 2015.

May it bring you greater heights of success and prosperity. www.aci-apa.com

VIEWPOINT

other industry stakeholders to help influence and shape global aviation policies.

Flipping the calendar back to August, I visited India with ACI World’s director general, Angela Gittens, and director of economics, Rafael Echevarne.

It was a fruitful meeting as we had the opportunity to meet with key senior aviation officials, including the newly appointed Minister of Civil Aviation, who brought us up to speed with the status of the Indian airport industry and the latest economic regulatory initiatives suggested by the Indian regulator.

One of the key challenges for Indian aviation is the development of airport infrastructure. We emphasised the need for India to have the right economic regulatory framework in place to encourage the development of new infrastructure.

7

8

ASIA-PACIFIC AIRPORTS MAGAZINE

NEWS

VIP TREATMENT Abu Dhabi International Airport has inaugurated its new VIP Terminal, built in partnership with National Aviation Services Group (NAS).

According to Abu Dhabi Airports Company (ADAC) chairman, HE Ali Majed Al Mansoori, the new 924sqm facility will enhance the airport’s appeal and boost its capacity.

“The main objective behind this new proposition is to enhance the service level offered to passengers from all travelling classes,” says Al Mansoori.

“Through the new VIP Terminal, Abu Dhabi Airports aims to provide the ultimate in privacy, luxury and security through unique personalised services.”

NAS has provided Abu Dhabi’s Golden Class ‘meet and assist’ service on behalf of ADAC since 2012.

CHANGI’S WINTER WONDERLAND A sprinkling of snow, a touch of winter and a dazzle of Disney magic will welcome travellers this Christmas as Singapore Changi Airport transforms into a winter wonderland, bringing yuletide festivities to life. Taking centre stage at Terminal 3 Departure Hall is a three-storey, interactive Neuschwanstein Castle, featuring a moving train experience, taking visitors through the idyllic charms of Germany’s countryside. And to complete the Christmas winter wonderland experience, Changi will even make it snow in the terminal.

BUILD AND GROW Wellington Airport has started the NZ$58 million 6,000sqm extension of its main terminal building and apron following the green light from its airline partners, the airport community and stakeholders.

When the main terminal was opened in 1999, around 9,500 passengers flowed through the airport each day, but this has now shot up to 15,000 on average, with busy days reaching up to 20,000.

The extension will add another 30 metres to the terminal building, double the width of both southern piers, provide extra gate lounge space, new retail and food and beverage offerings, double the number of toilets and provide more parking spaces for aircraft.

Steve Sanderson, chief executive of Wellington Airport, says: “The extension will provide a refreshing, open space with easy movement throughout the terminal, clear signs and a centralised screening point for all passengers. It will be a very comfortable place to welcome and to bid farewell to visitors, family and friends.”

The airport has appointed Hawkins as the main contractor for the extension, which will take around one and a half years to complete.

APA Issue 4, 2014

SIX OF THE BEST Wan-su Park has become the sixth chief executive officer of Incheon International Airport Corporation. Among his duties will be to oversee the third stage of the airport’s expansion programme and projects that include a second passenger terminal and new ‘business zone’ next to the gateway. Park was the Mayor of Changwon City for 10 years from 2004 until earlier this year.

ASIA-PACIFIC AIRPORTS MAGAZINE

NEWS

TAKE-OFF FOR NEW RUNWAY The government of Hong Kong has approved an Environmental Permit for the proposed three-runway system (3RS) at Hong Kong International Airport, paving the way for a new third runway within the next decade.

As a trade-off for the new runway, AAHK has agreed to help create a 2,400 hectare marine park and formulate and finance a detailed Marine Ecology Conservation Plan with support from relevant experts and stakeholder groups.

Airport Authority Hong Kong (AAHK) CEO, Fred Lam, insists that the airport is currently operating very close to its maximum capacity and claims that expanding into a three-runway system will allow Hong Kong to meet its long-term air traffic demand, while generating local employment and facilitating economic development.

AAHK will now submit its recommendation to the government on how to take the project forward.

“We aim to obtain all the necessary approvals to expand the airport, with the aim of having the 3RS fully operational in 2023,” says Lam.

9

DUBAI ON TRACK TO POST RECORD YEARLY TRAFFIC FIGURES Passenger traffic at Dubai International Airport rose 5.7% in October putting the gateway on track to eclipse the 71 million mark by year-end, according to operator Dubai Airports.

The month total of 5.98 million compared to 5.6 million recorded in the corresponding month last year, an increase of 5.7%.

Year-to-date traffic rose 6.1% to 58.4 million compared to 55 million recorded during the same period in 2013, while aircraft movements grew 1.6% to 32,798, up marginally from the 32,279 recorded during October 2013.

Paul Griffiths, CEO of Dubai Airports, explains: “We are neck-and-neck with London Heathrow in our race for the number one position coming down the home stretch. It is sure to be a photo finish.”

UNDER NEW MANAGEMENT A Japanese-led consortium has signed a concession agreement with Myanmar’s Department of Civil Aviation (DCA) to operate Mandalay International Airport for the next 30 years.

The consortium – comprising Jalux, Mitsubishi Corporation (MC) and Myanmar’s SPA affiliated group-company Yoma Development Group Limited – is expected to take over responsibility for running the airport from March 2015.

The three companies have established a special purpose company for the task, MC-Jalux Airport Services (MJAS), with Jalux and MC each holding 45.5% of the shares, while Yoma holds the remaining 9%.

The project makes history as it is the first in which Japanese companies are involved in 100% private equity airport operations abroad.

Jalux has over 50 years of experience operating airport retail businesses (27 airport facilities) as well as in the management and maintenance of airport facilities in Japan.

Since 2010, domestic passenger traffic through Mandalay has been increasing by 20% per annum, reaching a 60% annual growth in international flights.

Mandalay, the second-busiest airport in Myanmar, has the capacity for 3mppa, but only handled around 750,000 in 2013. www.aci-apa.com

10

ASIA-PACIFIC AIRPORTS MAGAZINE

ACI ASIA-PACIFC NEWS

Regional update Vivian Fung reports on the latest news, views and events across the Asia-Pacific region.

T

he social and economic importance of small and emerging airports and the need for them to overcome a number of challenges to grow and flourish came through loud and clear at the recent ACI Asia-Pacific Small and Emerging Airports Seminar in Bali.

In his opening remarks, ACI Asia-Pacific president, Dennis Chant, reminded members that while a strong and steady rise in passenger traffic across the region was fantastic, airports had to ensure that they were equipped to face the challenges and embrace the opportunities that this growth will bring.

He also assured delegates that ACI Asia-Pacific would continue to work closely with its airport members to build a brighter future for the aviation industry.

ASQ FORUM

His thoughts were echoed

by Tommy Soetomo, president director of conference host, Angkasa Pura Airports.

“As a fast growing country, Indonesia needs a strong foundation of world-class infrastructure, including modern airports. To keep pace with the rising traffic

The annual ASQ Forum for Asia-Pacific and Africa also proved popular with members, with this year’s event in Sanya on Hainan Island in September attracting over 100 delegates.

Current programme contractor and event organiser, DKMA, explained more about understanding customer service and managing queuing times in addition to sharing best practices from Beijing Capital, Kuala Lumpur and Incheon airports.

The event finished on September 12 with a tour to Sanya Phoenix Airport, which won the ‘Best Improvement’ award for the Asia-Pacific region in 2012.

APA Issue 4, 2014

demands, Indonesia needs to upgrade facilities in the areas of service, hospitality, science and research.”

Dennis Chant (right) is pictured above at the opening ceremony with regional director, Patti Chau, and Angkasa Pura Airports president director, Tommy Soetomo.

Taking the opportunity of this Forum, ACI World and ACI Asia-Pacific hosted an Information Session to brief members about the ASQ programme from 2015 onwards.

About 20 airports attended the session where ACI World and TNS Canada, the sub-contractor from January 2015, briefed members about the improved features of the new programme and answered questions raised by the airports.

For more information about the ASQ programme, please contact Natalie Tsang at Natalie@aci-asiapac.aero.

ASIA-PACIFIC AIRPORTS MAGAZINE

February 25-27 Airport Economics & Finance Conference London, UK

2015

April 27-29 ACI Asia-Pacific Regional Assembly, Conference & Exhibition Dead Sea, Jordan

2015

September 16-18 The Trinity Forum Hong Kong, China

ACI ASIA-PACIFIC BOARD

PRESIDENT

Dennis Chant* (Queensland Airports Limited, Australia)

FIRST VICE PRESIDENT

Seow Hiang Lee* (Changi Airport Group Pte Ltd, Singapore)

SECOND VICE PRESIDENTS Kerrie Mather* (Sydney Airport Corporation Limited, Australia) PS Nair* (Delhi International Airport Limited, India)

SECRETARY-TREASURER Emmanuel Menanteau* (Cambodia Airports, Cambodia)

IMMEDIATE PAST PRESIDENT

Tan Sri Bashir Ahmad Abdul Majid** (Malaysia Airports Holdings Berhad, Malaysia)

REGIONAL BOARD DIRECTORS

Saud AR Hashem* (General Authority Of Civil Aviation, Saudi Arabia)

Mark Young (Adelaide Airport Limited, Australia)

Seok Ki Kim (Korean Airports Corporation, Korea)

Waleed Youssef (Tibah Airports Operation Co Ltd, Saudi Arabia

Derun Li (Shanghai Airport Authority, China)

Sulaiman Zainul Abidin (Pioneer Aerodrome Service Co Ltd, Myanmar)

Xue Song Liu (Beijing Capital International Airport Co Ltd, China)

HE Ali Salim Al Midfa (Sharjah Airport Authority, UAE)

Laurensius Manurung (PT Angkasa Pura II, Indonesia)

Keiichi Ando (New Kansai International Airport Co Ltd, Japan)

Pedro Roy Martinez (AB Won Pat International Airport Authority, Guam)

Kjeld Binger (Airport International Group, Jordan)

ACK Nair (Cochin International Airport Limited, India)

David Fei (Taoyuan International Airport Corporation, Taiwan)

Sasisubha Sukontasap (Airports of Thailand, Thailand)

Kenichi Fukaya* (Narita International Airport Corporation, Japan)

REGIONAL BOARD DIRECTOR (WBP) Andrew Ford (DFS Group Limited, Hong Kong)

SPECIAL ADVISORS

Datuk Badlisham Bin Ghazali (Malaysia Airports Holdings Berhad, Malaysia) Fred Lam (Airport Authority Hong Kong, Hong Kong) Wan-su Park (Incheon International Airport Corporation, Korea)

* WGB member **Regional Advisor on WGB

The ACI Asia-Pacific region represents 101 members operating 591 airports in 48 countries and territories. www.aci-apa.com

ACI ASIA-PACIFC NEWS

EVENTS 2015

11

ASIA-PACIFIC AIRPORTS MAGAZINE

TRAFFIC TRENDS

TRAFFIC TRENDS Year-to-date Airports in Asia-Pacific and the Middle East enjoyed respective 5.1% and 9.3% increases in passenger traffic in September 2014.

T

With the exception of Jakarta’s Soekarno–Hatta International Airport, which reported a 5.3% decline in passenger numbers for the period January to September, the combined region’s top five airports – Beijing Capital (+1.4%), Tokyo Haneda (5.7%), Dubai (6.2%) and Hong Kong (5.6%) – all registered a rise in throughput.

Freight volumes continued to show signs of solid recovery in September, Asia-Pacific airports recording a year-on-year increase of 6.1% while the Middle East recorded a significant growth of 21%.

he monthly increases mean that traffic in Asia-Pacific and the Middle East was up 4.7% and 8.9% in the first nine months of 2014 and 5.2% and 9.1% respectively for the year ending September 30.

ACI attributes the healthy upturns to an increase in domestic travel, with almost 40% of airports reporting double-digit growth.

Among the high growth airports in September, five recorded an increase in excess of 30% – Bangalore (+54.4%), Bangkok Don Mueang (+35.6%), Goa (+34.3%), Palembang (+34.3%) and Hyderabad (+34%).

APA

SUMMARY OF ASIA-PACIFIC REGION TRAFFIC RESULTS (%) Sep 2014 Over Sep 2013

Jan to Sep 2014 Over Jan to Sep 2013

12-month rolling year

PaxFlash

International passengers

AsiaPacific

Middle East

AsiaPacific

Middle East

AsiaPacific

Middle East

2.6

9.4

4.7

9.3

5.5

9.5

Domestic passengers

7.1

-

4.8

-

5.2

-

Total passengers

5.1

9.3

4.7

8.9

5.2

9.1

FreightFlash

International freight

13

AsiaPacific

Middle East

AsiaPacific

Middle East

AsiaPacific

Middle East

6.2

21.0

6.1

12.3

5.6

11.2

Domestic freight

5.7

-

5.0

-

5.1

-

Total freight

6.1

21.0

5.8

12.3

5.4

11.2

www.aci-apa.com

14

ASIA-PACIFIC AIRPORTS MAGAZINE

AIRPORT REPORT: CAMBODIA

Coming of age On the eve of the 20th anniversary of operating Cambodia’s airports, CEO, Emmanuel Menanteau, talks to Joe Bates about booming passenger traffic, customer service and the next phase of infrastructure development.

C

ambodia is arguably one of the best examples on the planet of how private investors can transform a country’s airport system for the better.

Quite a claim? Well, there is simply no denying that passenger traffic at Phnom Penh International Airport has increased tenfold since the Cambodian government awarded Cambodia Airports (formerly known as Société Concessionnaire des Aéroports) the 30-year concession to operate, manage and develop it back in 1995.

Indeed, under the umbrella of Cambodia Airports, traffic at Phnom Penh has grown from less than 200,000 passengers annually in 1995 to close to 2.4 million last year.

The huge upturn in traffic and almost immediate investment in upgrading the airport’s core infrastructure – it opened a new terminal, renovated the existing runway and invested in new airfield lighting and navigational aids – so impressed the Cambodian government that it awarded it the concession to operate Siem Reap International Airport in 2001 and Preah Sihanouk International Airport in 2006.

APA Issue 4, 2014

And as part of the terms of the contract for the latter – Sihanouk is the gateway to the country’s southern beach resorts – Cambodia Airports’ concession for Phnom Penh was extended by a further 10 years and has since been extended to 2040.

True to form, a new passenger terminal, cargo facilities and an airfield upgrade quickly followed at Siem Reap, ensuring that the gateway, which handled just 200,000 passengers as recently as 1998, is now equipped to handle in excess of 2.5 million passengers yearly.

While at Sihanouk International Airport it has spent $30 million on refurbishing the terminal building and extending the runway to 2.5 kilometres to allow the gateway to handle aircraft up to the size of the B737 and A320.

To date the combined cost of modernising the country’s airport system has exceeded $300 million, and there is more to come as Cambodia Airports is currently in the middle of a three-year $100 million project to expand the terminals at both Phnom Penh and Siem Reap.

Each airport currently boasts a 25,000sqm terminal, which is being almost doubled in

ASIA-PACIFIC AIRPORTS MAGAZINE

TRAFFIC GROWTH

Traffic at Phnom Penh and Siem Reap grew by 18% in 2013 and has soared by between 12% and 20% annually for the past four years.

Menanteau attributes the increase to a combination of Cambodia’s growing economy, stable political climate, thriving

tourism industry – initially boosted by the Hollywood blockbuster Lara Croft: Tomb Raider, part of which was filmed at the country’s Angkor Wat temple complex – and, of course, the new facilities, which he believes will take operational efficiency and customer service standards to the next level.

He says: “Last year was a very good year for us with 18% growth across our three airports, which between them handled just over five million passengers.

“It followed double-digit growth in both 2011 and 2012 and, to be honest, although the global economic downturn did have an impact on traffic levels, we recovered quickly as the Cambodian market proved quite resilient to the crisis.”

In total, 2.4 million passengers (+14%) passed through Phnom Penh, 2.6 million (+20%) through Siem Reap and 20,000 (+51%) used Sihanoukville in 2013, and Menanteau admits that such levels of growth are unlikely to be repeated this year.

“We expect growth levels to be a little bit less in 2014, somewhere in the region of 11% to reach 5.6 million passengers, but we are quite satisfied with this because it is unrealistic to think that traffic can keep growing at close to 20% each year,” he states.

“As with any market, traffic figures do eventually slow down and plateau as markets mature, especially to tourist destinations like Siem Reap, which is really a once-in-alifetime destination for many.”

He adds that he would be more than happy with “stable growth” of around 10% to 12% per annum going forward, as it will make the ongoing expansion projects at Phnom Penh and Siem Reap slightly easier to manage.

www.aci-apa.com

AIRPORT REPORT: CAMBODIA

size to 45,000sqm to effectively double the capacity of both gateways from 2.5mppa to 5mppa by 2016.

France’s VINCI Airports has a controlling 70% stake in Cambodia Airports, and as is the way with most of its gateways, the group’s building division, VINCI Construction Grands Projets (VCGP), is carrying out the construction work, which started in early 2013 and is due for completion in early 2016.

And Cambodia Airports’ investment programme for the next five years rises to above $250 million taking into account additional airfield improvements, new cargo facilities and other projects across its airport system.

“The terminal expansion projects will ensure that we have sufficient capacity until at least 2022/23,” enthuses Menanteau.

“I believe our investment programme in Cambodia’s airports, the rapid rise in passenger traffic across the country and expanding route networks shows just what can be achieved through public-private partnership (PPP) projects. We are a longterm investor and are in it for the long-haul.”

Cambodia Airports’ other shareholder is Malaysian-Cambodian consortium, Muhibbah Masteron Cambodia, which has a 30% stake in the joint venture.

15

16

ASIA-PACIFIC AIRPORTS MAGAZINE

AIRPORT REPORT: CAMBODIA

Face of the future: Phnom Penh’s terminal is to double in size by 2016.

SEASONALITY

Another reason for Menanteau to be satisfied with the anticipated 11% upturn in passenger traffic across his three airports in 2014 is because the increase has been spread throughout the year and not just during the traditionally high ‘tourist season’ of November to January.

He explains: “Siem Reap, in particular, has always suffered from seasonality, with passenger numbers trebling in the high season compared to the low season in August. However, this year we experienced a 20% increase in visitors during August and September, so we are closing the gap and that makes me extremely confident about strong future year-round growth.”

As a result, Menanteau expects around 2.9 million passengers to pass through Siem Reap International Airport in 2014, which he notes is now directly connected to dozens of cities in China and “most major Asian cities”.

In contrast to Siem Reap and Sihanoukville, Phnom Penh International Airport continues to handle a strong year-round mix of business and tourist traffic as well as a high number of people returning to Cambodia or flying to the capital to visit family and friends.

According to Menanteau, this appeal should lead to around 2.65 million passengers using Phnom Penh in 2014.

Sihanouk, tiny in comparison, is expected to welcome 50,000 passengers this year.

APA Issue 4, 2014

CUSTOMER SERVICE

Menanteau says that Cambodia is known as the ‘Kingdom of Wonder’ and that customer service comes naturally to Cambodians, who are extremely welcoming to visitors.

As such he notes that his workforce were quick to embrace the company’s customer service philosophy and various passengerfocused initiatives such as ‘Smiling Day’, inspired by VINCI Airports, where once a year all airport frontline employees from airline check-in staff and shop workers to police, security, customs and immigration officers are encouraged to interact with passengers, smile and in some cases hand out gifts.

“We all play a part when it comes to the airport experience and delivering good customer service to passengers. It is not just the job of Cambodia Airports staff who rarely deal with customers,” muses Menanteau.

One of its more unusual initiatives has been to introduce a new technology that diffuses relaxing aromas at its check-in counters, arrival hall and business lounge in a bid to enhance the airport experience by creating a “more relaxing environment” for passengers.

CONCESSION OFFERINGS

Menanteau admits that the company is constantly striving to improve the quality of the retail/F&B offering at Cambodia’s airports to increase the choice for passengers and boost concession revenues.

18

ASIA-PACIFIC AIRPORTS MAGAZINE

AIRPORT REPORT: CAMBODIA

Indeed, both Phnom Penh and Siem Reap now have a variety of shops and restaurants that will be joined by dozens of new outlets when the terminal expansion projects are completed.

His commitment to enhancing the retail offering at Cambodia’s airports is perhaps why he describes the news that duty free operator, Dufry, has extended its concession at Phnom Penh and Siem Reap airports until 2020 as “significant”.

“The opening of the terminal extensions will allow us to completely transform the size and quality of the retail offering at our airports, which at Phnom Penh will include the first walk-through concept stores at a Cambodian airport and more than 2,000sqm of space for core categories,” he enthuses.

“As you probably know, it is more difficult for small to medium-size airports handling fewer than five million passengers per annum to make money from non-aeronautical activity than large hubs such as Bangkok Suvarnabhumi or Singapore Changi, because we just don’t have the opportunities that their throughput gives them. We therefore have to make maximum use of our facilities to be successful and I believe that the planned new duty free offering will help us do this.”

Menanteau notes that the expanded terminal at Phnom Penh will also boast a new independently run 1,500sqm CIP lounge for airline business class passengers. The facility will replace today’s 300sqm lounge.

ROUTE DEVELOPMENT

Cambodia Airports’ route development team is actively working with airlines, tour operators and government agencies – namely Cambodia’s ministries of transport, tourism and civil aviation – to encourage the launch of new routes or additional frequencies on existing ones.

Indeed, in the last two years Cambodia Airports has taken its route development efforts on the road by jointly organising tourism seminars and trade missions to countries such as India, China, Japan and Indonesia.

APA Issue 4, 2014

And the strategy appears to be working, as in the last couple of years a number of new routes have been launched to Siem Reap from China, South Korea and South East Asia, and the destination has begun to gain a reputation as a meetings, incentives, conference and exhibition (MICE) venue during the low-season.

The Khmer New Year in April has also become a popular time to visit Cambodia for many regional international visitors.

“Ten years ago when Angkor Wat was still a relatively unknown destination and therefore quite expensive to visit, the majority of tourists were from Europe [principally France] and the US,” says Menanteau.

“It is very different today as it is less exclusive and more easily accessible. As a result the majority of visitors are Asian, particularly from China.”

The changes ensure that over three million people will visit the Angkor Wat UNESCO World Heritage site in 2014 – around half of which will use Siem Reap International Airport.

Menanteau admits that the route development focus of Cambodia Airports right now is the Asian market, specifically China and South Korea as well as the three big markets which currently aren’t served direct from Cambodia – Japan, India and Indonesia.

In the mid-term he reveals that attention is likely to stay within the region, but extend to destinations within six or seven hours’

ASIA-PACIFIC AIRPORTS MAGAZINE

NATIONAL FLAG CARRIER

Its route development efforts have certainly been boosted in recent years by the launch of a new national flag carrier, Cambodia Angkor Air, five years ago.

Owned by the Cambodian government (51%) and Vietnam Airlines (49%), the joint venture is headquartered in Phnom Penh and currently operates a fleet of six aircraft (three

JUST THE BEGINNING

Menanteau is justifiably pleased with how things are going, but cautions that this is just the beginning for Cambodia’s airports.

“We are doing well, there is absolutely no doubt about that, and I am very happy,” he tells Asia-Pacific Airports. “But, compared to Thailand and Vietnam, we still have a long way to go, because while Cambodia welcomes around five million tourists per year, Vietnam accommodates some 10 to 12 million and Thailand more than 25 million.

“However, things are changing, because whereas 10 years ago people used to come to Cambodia and spend one or two days at Siem Reap as part of a trip to Thailand or Vietnam, now increasing numbers are just coming to Cambodia, as the country is being viewed as a destination in its own right.

APA The future looks very positive.” www.aci-apa.com

AIRPORT REPORT: CAMBODIA

flying time of Cambodia, such as Australia and New Zealand.

“We are already quite open with the Australian airlines about launching flights to Cambodia,” he says. “We see many Australians travelling to India and places like Bali in Indonesia and they are beginning to discover Cambodia, so why not add Phnom Penh to their route networks?

“In the long-term we would like to see Qatar launch Paris flights via Doha and it would be good to get an Emirates service to Dubai. We don’t think there is demand for direct long-haul flights to Europe or the US, as these destinations are already served from neighbouring hubs in Bangkok, Singapore and Hong Kong.”

Having said that, Air France did previously operate direct flights between Paris and Phnom Penh but pulled the plug last year, and Menanteau quips that he doesn’t see it, British Airways, Lufthansa or any other European carriers launching flights to Cambodia “any time soon”.

Airbus A321s and three ATR 72-500s) on international flights from Phnom Penh and Siem Reap to Bangkok, Guangzhou, Shanghai and Ho Chi Minh City and Hanoi in Vietnam.

It also operates charter services or seasonal flights between Siem Reap and the Chinese cities of Xiamen, Fuzhou, Hangzhou, Wenzhou and Zhengzhou and is said to be considering launching routes to Beijing, Seoul, Singapore, Phuket and Da Nang.

All flights are code-shared with Vietnam Airlines, which provides the carrier with technical support, crew training and aircraft maintenance.

Cambodia had been without a national flag carrier since predecessor, Royal Air Cambodge, went bankrupt in 2001.

“I think a strong national flag carrier is important for any country and should go hand-in-hand with a strong airport system, as you cannot develop as a hub without a home-based carrier,” says Menanteau.

“We are delighted that it has been launched with the support of the Cambodian government and is slowly developing its route network.”

19

20

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA

Investing in China Airport development in China continues at a phenomenal pace with dozens of major projects set to be completed in the next year, writes Joe Bates.

C

hina is a statistician’s delight, with an almost never-ending list of facts and figures out there about traffic growth and planned airport developments.

Officially around 753 million passengers (+11%) passed through China’s 193 commercial airports (excluding Hong Kong and Macau) in 2013.

Domestic traffic accounted for 690 million or 91.6% of all passengers handled across the nation’s airports in 2013, while international passenger traffic grew by 13.3% to 63.4 million.

APA Issue 4, 2014

And according to the Civil Aviation Administration of China (CAAC), these incredible annual growth rates show no sign of slowing down any time soon.

Indeed, China’s airports are expected to handle 873 million per annum by 2016, and to support this massive growth airports are investing in new infrastructure and technology.

As you will read later in this issue, the latest SITA Airport IT Trends Survey discovered that over the next three years more than half (54%) of China’s leading airports are planning expansion, while half are building new airport terminals.

Beijing Capital International Airport handled 83.7 million

ASIA-PACIFIC AIRPORTS MAGAZINE

While airports such as Xi’an Xianyang, Chengdu Shuangliu, Haikou Meilan and Shenzhen Bao’an are among those to have inaugurated new showpiece terminals.

They will be joined by Shanghai Pudong when it opens its new South Terminal Satellite Concourse in 2018.

Without doubt the biggest major project currently on the drawing board is the planned new $11 billion Beijing Daxing Airport (see page 24), which is expected to boast an initial capacity of 45mppa – rising to up to 200mppa over time – when it opens at the end of the decade.

Another huge project is the proposed $4.3 billion construction of Dalian International Airport on 20 square kilometres of reclaimed land off the coast of north-east China (see page 33).

Most recently China approved construction of five airports and three rail projects worth $24.5 billion in its latest move to speed up infrastructure projects to boost growth.

The airports will be located in the northwestern provinces of Qinghai and Inner Mongolia, south-western provinces of Yunnan and Guizhou and north-eastern Jilin Province.

ECONOMIC SLOWDOWN

FIVE-YEAR PLAN

In July 2012, Li Jiaxiang, head of CAAC, announced that China would build 70 new airports in the current Twelfth Five-Year Plan (2011–2015) and expand and upgrade another 101 gateways.

It is unclear how successful the government has been in implementing this ambitious plan, but China has certainly welcomed the opening of a host of new airports in the past three years that have included Bijie Feixiong (Guizhou Province), Chizhou Jiuhuashan (Anhui Province), Gannan Xiahe (Gansu Province), Kunming Changshui (Yunnan Province), Yichun Mingyueshan (Jiangxi Province), and the world’s highest airport at Daocheng Yading in the Tibet region of Sichuan Province.

With 134 of China’s airports operating at a loss, some question whether building more regional gateways is necessary, especially as the nation’s economy is downsizing.

They argue that with four airports in the three municipalities of Beijing, Shanghai and Guangzhou currently accounting for over 30% of the total passenger traffic handled in China every year, is there really any need for more airports in some of the nation’s more remote locations?

However, there is nowhere on the earth quite like China in terms of population base and growth potential, and to put things in perspective, 58% of European airports handling less than 5mppa currently operate at a loss.

The changing Chinese economy is acknowledged in a new report by Brooks Market Intelligence, which states that the relentless growth of China’s economy, which www.aci-apa.com

21

SPECIAL REPORT: CHINA

passengers in 2013. Image courtesy of BCIA.

22

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA

has been expanding by around 10% for each of the last three decades, is entering an era of slower growth.

According to the report, The People’s Republic of China – Airports, Capital Investment Programmes 2014 – the highlights of which we review on the following pages – it fell to 7.8% in 2012, its slowest growth rate in 13 years, and the trend continued in 2013, when it dropped to 7.7%.

It states that although some industry experts and banking institutions predicted that China’s economy would speed up again this year to over 8%, there have been no signs of this upturn, with growth steady at 7.4% in the first six months of 2014.

because of the local government debt. That is not the way the Chinese system works.”

Zhang’s views are expressed in a new ‘vision paper’ for China’s airport sector, The Future of Aviation in China: How innovation is vital to support China’s aviation ambitions, published by ADB Airfield Solutions.

It argues that the main challenge facing China today is how to maintain its aviation growth while achieving sustainability and an “unrelenting focus” on safety.

And it claims that the key to success requires investment in airport and air navigation infrastructure and innovation to ensure greater operational efficiencies.

The Chinese government has identified aviation as a strategic enabler Indeed, China’s economy was recently described by former premier, Wen Jiabao, as “unbalanced, uncoordinated and unsustainable”, but the present administration, while accepting that high growth is unsustainable, says it is rebalancing the economy away from investment and exports, towards domestic consumption.

RESILIENCE OF AVIATION

Fortunately for aviation, the ‘slow down’ in the Chinese economy appears to have had little impact yet on the continued government-led development of China’s airport system.

The simple reason for this is the fact that the government views aviation as vital to economic growth.

“The Chinese government has identified aviation as a strategic enabler,” says IATA’s regional vice president for north Asia, Baojian Zhang.

“There is a well-documented five-year civil aviation development plan. It is unlikely that airport construction will slow down APA Issue 4, 2014

“While new airports are critical to unlocking the potential of the economic development of the different regions and the cities, operational efficiency is key to enable a higher volume of flights and to justify investments with a better return because of lower costs per passenger and higher revenues,” says Roland Berger’s Qi Wu. “Many of the airports are congested because they are not very well designed, but also because of poor operational procedures.

Their performance could be improved by shortening the turnaround time through the integration of high-tech systems that allow planes to move more quickly to the terminal after landing and leave faster.”

The size of China, its huge airport development programme and growth potential of its vast population ensure that Chinese airports will continue to make the news for years and possibly decades to come.

With the amount of money being invested in its airport system, the Chinese government will be hoping for good headlines all the way.

APA

24

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA

Boosting Beijing

Justin Burns finds out more about Beijing’s planned new capacity-busting international airport.

T

hree years after the Chinese government confirmed its plans to build a new mega-hub, a few more details are finally beginning to emerge about Beijing Daxing International Airport.

Located at Daxing, around 60 kilometres south of Beijing’s Tiananmen Square, the new gateway will cover 700,000 square metres, feature a five-kilometre-long façade and eventually boast up to six runways.

The sheer size and scale of the project place it on a par with the planned new mega-hub in Istanbul and the ongoing development of Al Maktoum International Dubai World Central, both of which are being built to handle between 150–200mppa.

According to Travel Daily Asia the new $11.5 billion Beijing Daxing will have an initial capacity of 45mppa, rising to 72mppa and eventually in excess of 100mppa.

In September, ADP Ingénierie (ADPI) was awarded the contract by the Beijing New Airport Construction Headquarters (BNAH) to design Terminal 1 at the new gateway.

“It will be one of the biggest terminals in the world but will initially open with a capacity of 45 million passengers annually,” ADPI’s CEO, Guillaume Sauvé, tells APA. “Doing it this way will ensure that we get things right and minimise the costs of phase one. It is still early in the project and we are working closely with the client to ensure that we deliver what they want.”

APA Issue 4, 2014

PASSENGER FRIENDLY

The terminal will have 82 aircraft stands, state-of-the-art IT systems and an integrated Ground Transportation Centre designed to ensure the rapid transfer of passengers between the terminal and high-speed rail links to downtown Beijing and beyond.

The integration of technologies will also extend to state-of-the-art ways to transfer passengers from high-speed rail and downtown transportation links, which will be integrated into the terminal design.

Sauvé says: “We have worked a lot on the internal planning of the terminal, especially its compact design, which will feature a stacked, two-level departure area – one for business and first-class passengers, and another for economy – along with a compact building producing a very efficient envelope which will be largely lit by natural light.

“We also want to keep the walking distance to a reasonable amount, so it will be a maximum of 600 metres, which is acceptable.”

SHOPS AND RESTAURANTS

The new terminal will seek to maximise non-aeronautical revenues through an extensive retail, duty free and F&B offering.

Indeed, the concessions offering is seen as critical to the success of the project in terms of creating a sense of place, comfort and convenience for passengers and, of course, revenue generation.

ASIA-PACIFIC AIRPORTS MAGAZINE

25

SPECIAL REPORT: CHINA

Passengers using Beijing Capital International Airport’s iconic Terminal 3. Picture courtesy of BCIA.

“We have paid a lot of attention to the retail side as from our point of view, the effectiveness and efficiency of the retail operation is critical to boosting revenues and also getting a good sense of feeling of the building,” notes Sauvé.

“Right from the beginning, the design is very compact and under one roof, and most of the passengers, hopefully 100%, will also go through the duty free areas.”

WORKING WITH THE CLIENT

Design images are set to be released by the end of 2014/early 2015, and at this stage there is no official start or completion date, but it could open as early as 2017 or 2018.

“The client wants to make the project happen relatively quickly, and once the project starts it will move very fast,” adds Sauvé.

According to Sauvé, a key part of ADPI’s strategy is making sure the client is in full control of the design, which he insists must remain flexible in the early stages, to ensure it is capable of embracing change and new trends in the aviation market.

He says: “Flexibility in the design is key for many reasons, not least because we don’t know yet which companies will be using the terminal and, of course, IT advances so quickly.”

EXPANSION IN CHINA

Winning the major architectural competition was a coup for ADPI, as the French operator fought off high-level international bids.

“Winning this competition over a three-year period was very tough, and is another major

step in China for ADPI,” admits Sauvé. “It will be great for our reputation, and gives us a competitive advantage in the market and across the region.”

ADPI isn’t a stranger to China, of course, as it drafted the master plan and performed design studies for Chongqing Jiangbei International Airport’s planned new Terminal 3 and won the contract to design the new terminal at Hainan’s Haikou Meilan Airport.

The company is also competing in the tender to design the new airport at Dalian (see page 33).

“The Chinese market is huge, and every two or three months there is a new airport tender announced. We are competing for Dalian and are very interested in expanding our portfolio of work further in China in the future,” enthuses Sauvé.

VITAL PROJECT

The new airport is needed as phenomenal traffic growth across China has led the government to predict that Beijing should be equipped to handle 142 million passengers per annum by 2020.

With Beijing Capital already handling more passengers than its 80mppa design capacity – the gateway accommodated a record 83.7 million passengers in 2013 – and its expansion possibilities limited, a new reliever airport is in effect the only way the city will be able to meet APA long-term demand. www.aci-apa.com

26

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA

Fast and the furious

Joe Bates picks out some of the highlights of a new report that reviews the capital investment programmes of close to 100 Chinese airports.

C

hina needs to embrace the privatisation of some of the state-owned enterprises responsible for operating and developing its airport infrastructure, according to a new report.

It claims that such action could relieve the financial pressure on the state and allow China to maintain its economic momentum.

The call is made in Brooks Market Intelligence’s report, The People’s Republic of China – Airports, Capital Investment Programmes 2014, which reviews the airport development projects at 94 airports across China.

There is certainly no disputing that the Chinese government has been concentrating strongly on airports, underpinned by a shift towards liberalising the aviation sector.

Indeed, the current Twelfth Five-Year Plan (2011–2015) for aviation predicts that 81% of China’s counties and cities will be served by a civil airport by 2015.

It also projects that more than 83% of the population – contributing 94% of China’s GDP – will live within 100 kilometres or 90 minutes’ driving time of an airport by the end of next year.

At present, around 61% of the population, contributing 82% to GDP, has convenient access to an airport, most of those living in the eastern part of the country.

APA Issue 4, 2014

THE BIG BUILD

In July 2012, Li Jiaxiang, administrator of the Civil Aviation Administration of China (CAAC), announced that China would build 70 new airports in the current Twelfth Five-Year Plan (2011–2015) and expand and upgrade another 101.

If successful this would equip China with 230 commercial airports by the end of next year.

And they could all be needed in the future, as traffic is currently rising at such a pace across China that experts are predicting that the number of Chinese airports serving more than 30mppa will increase from the current three – Beijing Capital, Guangzhou Baiyun and Shanghai Pudong – to 13 by 2020.

Shanghai Hongqiao, Shenzhen, Chengdu and Kunming are the four most likely to reach this level, the report suggests.

It is worth noting that Hong Kong, which handles close to 60mppa, is not included in CAAC’s plan, which only applies to mainland China airports.

In 2013, the number of airports handling more than 10mppa increased to 24, three more than in 2012. Between them they account for three-quarters of the total turnover of Chinese airports.

ASIA-PACIFIC AIRPORTS MAGAZINE

Rank

City/Airport [IATA/ICAO code]

Province

Passengers

Growth

Beijing

83,712,355

2.20%

1

Beijing Capital [PEK/ZBAA]

2

Hong Kong [HKG/VHHH]

Hong Kong

59,913,000

6.10%

3

Guangzhou Baiyun [CAN/ZGGG]

Guangdong

52,450,262

8.60%

4

Shanghai Pudong [PVG/ZSPD]

Shanghai

47,189,849

5.20%

5

Shanghai Hongqiao [SHA/ZSSS]

Shanghai

35,599,643

5.20%

6

Chengdu Shuangliu [CTU/ZUUU]

Sichuan

33,444,618

5.90%

7

Shenzhen Bao’an [SZX/ZGSZ]

Guangdong

32,268,457

9.10%

8

Kunming Wujiaba [KMG/ZPPP]

Yunnan

29,688,297

23.80%

9

Xi’an Xianyang [XIY/ZLXY]

Shaanxi

26,044,673

11.20%

Chongqing

25,272,039

14.60%

10

Chongqing Jiangbei [CKG/ZUCK]

STRENGTHENING THE KEY HUBS

The 2011–2015 Plan specifically targets strengthening Beijing, Guangzhou and Shanghai’s airports to improve their international hub functions and enhancing their complementary airports in the Pearl River Delta, Yangtse River Delta and the Beijing-Tianjin-Hebei triangle to promote a multi-airport system.

Other key targets, explains the report, include the establishment of an efficient ATC system; improving the management of its airports; the “vigorous development” of passenger transportation; reducing flight delays; and speeding up development of general aviation.

In monetary terms, CAAC has estimated the total cost of airport construction and expansion at a massive $73 billion, a substantial increase on the $30 billion expended during the previous five years.

Says the report: “This is by far the largest and most ambitious airport investment programme anywhere in the world and has been drafted to meet increasing demand, which is predicted to result in annual average passenger traffic growth of 11.4% until 2020.”

TRAFFIC DATA

North China accounted for 16.9% of passenger traffic, Northeast China for 6.3%, East China for 29.1%, Central South China for 24.1%, Southwest China for 15.6%, Northwest China for 5.5%, and Xinjiang region for 2.5%.

The number of airports serving more than one million passengers has grown to 61, four more than in the previous year.

Between them they account for 95.4% of all traffic.

Cargo reached 12.585 million tonnes in 2013 (+4.9%). Domestic cargo amounted to 8.3 million tonnes (+5.7%), with international cargo traffic up by 3.4% to 4.285 million tonnes.

Regional distribution was 18% in North China, 3% in Northeast China, 40.8% in East China, 24.5% in Central South China, 9.6% in Southwest China, 2.2% in Northwest China, and 1.4% in Xinjiang region.

There are now 50 airports handling more than 10,000 tonnes of cargo with Beijing, Shanghai and Guangzhou accounting for 51.8% of the total. Aircraft movements reached 7,315,000, an increase of 10.8% over the year before. www.aci-apa.com

SPECIAL REPORT: CHINA

CHINA’S BUSIEST AIRPORTS IN 2013

Passengers in millions (percentage growth or decline over 2012)

27

Busy times at Hangzhou Xiaoshan International Airport.

28

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA THE NEXT GENERATION A snapshot of China’s busiest gateways outside of the top 10.

HANGZHOU XIAOSHAN INTERNATIONAL AIRPORT

Hangzhou Xiaoshan, already the biggest and busiest airport in Zhejiang Province, is being further expanded with the aim of creating the largest facility on the Eastern Seaboard after Shanghai.

The project is part of the strategy of the Airport Authority Hong Kong (AAHK), which took a 35% stake in the Hangzhou Xiaoshan International Airport Co Ltd to develop the Chinese market.

Hangzhou Xiaoshan International Airport Co Ltd was first established in December 2000, but was converted into a joint venture company with a registered capital of $950 million in December 2006 when AAHK acquired its 35% stake for a 30-year term.

The remaining 65% is held by the Zhejiang Province Airport Administrative Co, Hang Zhou Investment Holding Co Ltd, and Hang Zhou Xiaoshan Capital Management Co. APA Issue 4, 2014

Construction of Phase II of the expansion was started in November 2006, with the first stage completed in 2010. This included a 96,000sqm international terminal and auxiliary facilities. A 100,000sqm domestic terminal (T3) was opened in December 2012, and a 3,400 x 60m Class 4F runway, capable of handling the A380, will be in place by 2015, when the total area of terminals will be 230,000sqm with 85 gates.

Also part of Phase II is a 567,000sqm apron with 67 new parking bays and a FedEx cargo centre, which includes a 60,000sqm sorting centre and an apron with 26 aircraft stands.

Upon completion of both stages by 2015, the estimated capacity at the airport will be 25.6 million passengers, 500,000 tonnes of cargo and 260,000 aircraft movements.

In 2013 the airport handled 22.1 million passengers (+15.7%) and 368,095 tonnes of cargo (8.8%).

ASIA-PACIFIC AIRPORTS MAGAZINE

Rank

City/Airport [IATA/ICAO code]

Province

Passengers

Growth

11

Hangzhou Xiaoshan [HGH/ZSHC]

Zhejiang

22,114,103

15.70%

12

Xiamen Gaoqi [XMN/ZSAM]

Fujian

19,753,016

13.80%

13

Changsha Huanghua [CSX/ZGHA]

Hunan

16,007,212

8.50%

14

Wuhan Tianhe [WUH/ZHHH]

Hubei

15,706,063

12.30%

15

Urumqi Diwopu [URC/ZWWW]

Xinjiang

15,359,170

15.10%

16

Nanjing Lukou [NKG/ZSNJ]

Jiangsu

15,011,792

7.20%

17

Qingdao Liuting [TAO/ZSQD]

Shandong

14,516,669

15.20%

18

Dalian Zhoushuizi [DLC/ZYTL]

Liaoning

14,083,131

5.60%

19

Zhengzhou Xinzheng [CGO/ZHCC]

Henan

13,139,994

12.60%

20

Sanya Phoenix [SYX/ZJSY]

Henan

12,866,869

10.20%

The long-term plan to 2035 provides for four runways, a total passenger terminal area of 570,000sqm and a 380,000sqm cargo warehouse. Annual capacity will double to 52mppa, one million tonnes of cargo and mail, and 500,000 aircraft movements.

CHANGSHA HUANGHUA INTERNATIONAL AIRPORT

This airport serves the capital city of Hunan Province and is one of the most important in central China. It is a regional hub for China Southern Airlines and has connections to all principal cities in China, including Hong Kong.

In 2013, 16 million passengers (+8.5%) passed through the airport, making it the twelfth busiest on the mainland.

A major $348 million expansion, started in July 2006, was completed with the opening of the new 212,000sqm terminal – the fifth biggest in China – in July 2011. A 600m extension of the runway from 2,600 to 3,200m, together with additional taxiways and hardstands, was completed in April 2009, while the renovation of the existing terminal and the enlargement of the parking area have recently been completed.

A new plan for the further development of the airport (2009–2040) has been drawn up

based on an expected passenger throughput of 62 million passengers, 1.8 million tonnes of cargo and 502,000 aircraft movements annually by 2040.

Part of the plan is a second runway, 3,800m in length, together with two parallel taxiways, construction of which began in November 2013, following completion of the necessary expropriation of land and relocation of housing.

Two further runways are also envisaged as is another terminal building, cargo complex, maintenance area and other ancillary facilities. Four rail stations are also planned to facilitate access from the city.

XIAMEN GAOQI INTERNATIONAL AIRPORT

The major airport for the province is operated by the Xiamen Airport Development Co Ltd, established in May 1996. Completed recently were the $37 million Garden Plaza parking area, which has space for 1,111 vehicles, and an apron expansion.

A new 72,000sqm Terminal 4 designed to handle 10mppa to 12mppa was recently completed. Aimed at low-cost domestic airlines, the facility is part of a $667 million www.aci-apa.com

SPECIAL REPORT: CHINA

CHINA’S BUSIEST AIRPORTS IN 2013

Passengers in millions (percentage growth or decline over 2012)

29

30

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA Shanghai Pudong’s new South Satellite Concourse. Image courtesy of Corgan.

development project that will also add a new logistics centre, expanded aircraft aprons and a new runway that will effectively raise the airport’s capacity to 27mppa.

In 2013, the gateway handled 19.7 million passengers (+13.8%) and 299,491 tonnes of cargo (+10.3%).

URUMQI DIWOPU INTERNATIONAL AIRPORT

Urumqi Diwopu is one of the most important airports in China’s northwest, serving the capital city of Xinjiang.

In 2013, 15.3 million passengers (+15%) passed through the airport, which offers connections to more than 40 cities in China and 20 international destinations, that includes all five central Asian republics.

The airport’s newest terminal, the 106,000sqm Terminal 3 built at a cost of $440 million, opened in December 2009.

T1 and T2 were reconstructed in 2011 as part of a $14 million modernisation programme.

A feasibility study has been completed for the Phase IV expansion of the airport although it has yet to receive approval.

Its proposals are based on an ultimate annual capacity of 42mppa and include APA Issue 4, 2014

plans for a new runway capable of handling the Airbus A380 by 2025 and a fourth terminal building.

Meanwhile, the National Development and Reform Commission has approved an $80 million proposal for a new 14,000sqm ATC complex with management training facilities and a VHF remote control system.

WUHAN TIANHE INTERNATIONAL AIRPORT

The Hubei Airports Group has signed a strategic framework agreement with China’s leading airlines to develop the airport into an international aviation hub and, as a result of the deal, Air China, China Eastern Airlines and China Southern Airlines will base more than 60 aircraft at the airport.

The airport opened a 120,000sqm terminal (T2) capable of accommodating 13mppa in 2008 as part of a development phase that also added a new 38,000sqm car park, 250,000sqm of apron and a 20,000sqm cargo warehouse. Terminal 1 was also renovated and its single runway lengthened by 400m to 3,600m.

A second runway capable of handling the A380 was completed in May 2009 as part of

ASIA-PACIFIC AIRPORTS MAGAZINE

31

SPECIAL REPORT: CHINA

Guangzhou Baiyun is the second busiest airport in mainland China.

the airport’s Phase II expansion project that took the airport’s spending on new facilities to $535 million.

Construction of Phase III – designed to develop Wuhan into China’s fourth hub after Beijing, Shanghai and Guangzhou – started in June 2013 and will add a futuristic 350,000sqm Terminal 3, a second 3,600 x 60m runway, two 3,600 x 25m parallel taxiways and connecting taxiways, a new apron for 54 aircraft, new ATC building, 11,000sqm cargo building, 140,000sqm parking area and office buildings.

When completed in 2020, the airport will boast more than 500,000sqm of terminal facilities between them capable of handling 38mppa. Wuhan Tianhe handled 15.7 million passengers (+12.3%) and 130,000 tonnes of cargo (+1%) in 2013.

NANJING LUKOU INTERNATIONAL AIRPORT

Nanjing Lukou handled 15,011,792 passengers (+7.2%) and 255,789 tonnes of cargo and mail (+ 3%) in 2013.

New additions to its infrastructure in 2014 include a second passenger terminal,

new (second) 3,600m x 60m runway and 20,000sqm of hardstands for parking aircraft and ground support vehicles.

The new 260,000sqm terminal (T2) is equipped with 42 gates and has helped raise the airport’s capacity to 15 million passengers and 400,000 tonnes of freight per annum.

The older terminals were renovated, expanded and improved under the umbrella of its Phase II development programme approved in 2010.

It is forecast that some 30 million passengers and 800,000 tonnes of cargo and mail per annum will pass through the airport by 2020.

An airport rail link, the Ninggao Intercity Line, is under construction and was due APA to be completed in late 2014.

ABOUT THE AUTHOR This article is based on extracts from Brooks Market Intelligence’s new report The People’s Republic of China – Airports, Capital Investment Programmes 2014, which takes an in-depth look at the development of China’s airport system.

Copies can be purchased at www.brooksreports.com

www.aci-apa.com

Justin Burns reports on China’s ambitious plan to build a new $4.2 billion airport in Dalian.

A

mbitious plans have been revealed to build a state-of-theart airport off the coast of Dalian, in Liaoning Province in north-east China, as part of an estimated $4.2 billion development project.

The new gateway is needed as the city’s existing Zhoushuizi International Airport is operating close to its saturation point despite recently opening a new 70,000sqm Terminal 3.

In 2013, it handled more than 14 million passengers (+5.6%) to cement its status as mainland China’s 17th busiest gateway, but according to traffic forecasts it is set to outgrow its 21mppa design capacity within the next five years.

New Dalian Jinzhou Bay Airport, as it will be named, will be built three kilometres off the coast of China on a 20.9 square kilometre artificial island in Jinzhou Bay. It will join other gateways that have been built on land reclaimed from the sea such as Japan’s Nagasaki Airport and New York– LaGuardia, which was built offshore on steel piles into the seabed.

If all goes to plan, Dalian is set to become the largest offshore airport in the world, as it boasts more land than both Japan’s Kansai International Airport in Osaka and Hong Kong International Airport.

According to Chinese officials, it will play an important part in the construction of the Dalian Northeast International Shipping Centre and northeast Asia International Logistics Centre, which are designed to revitalise the area and further the rapid development of Dalian.

33

SPECIAL REPORT: CHINA

Island life

ASIA-PACIFIC AIRPORTS MAGAZINE

The airport will initially have two runways and the capacity to handle up to 31 million passengers annually.

However, such are the growth projections for the region that plans are already on the drawing board for another two runways capable of handling aircraft up to the size of the A380 and additional passenger facilities to raise the capacity to 70mppa in the future.

China says the scarcity of land in Dalian means that constructing an offshore airport is the only viable way of building a new airport to serve the rapidly expanding area, where the population and economy are booming.

As a result, the Dalian municipal government has been inviting both military and civilian experts to carry out site work for the development since 2002.

Indeed, it is close to gaining approval for the huge land reclamation project that has to happen first before the airport can be designed, commissioned and constructed.

A statement issued by Dalian officials reads: “Because of the rapid growth of passenger throughput, Dalian’s existing Zhoushuizi International Airport has been overloaded, and despite three transformations, its transport capacity will reach saturation in about 2016.

“We were extremely limited in our choice of location as experts agreed that there was no other site within a 100km radius of the city for such a large civil airport.

“The chosen maritime location has the ideal conditions for the construction of the APA new airport.” www.aci-apa.com

34

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA

China news

Justin Burns rounds up the latest news and developments from airports across China.

HONG KONG’S MIDFIELD TERMINAL

THE X-FACTOR

Hong Kong International Airport (HKIA) has celebrated the topping-out of its new Midfield Terminal, which is due for completion at the end of 2015.

Located west of Terminal 1, between the two existing runways, the 105,000 square metre, five-level Midfield Concourse is a core part of HKIA’s Midfield Development.

The concourse will be equipped with 20 new aircraft parking stands, and passengers will be able to access it from Terminal 1 via an extended automated people mover.

Begun in 2011, the development’s construction is within a budget of more than HK$10 billion (€1 billion) and has so far created over 2,000 jobs.

Professor Anthony Cheung, Secretary for Transport and Housing, says: “Over the past decade, air traffic at HKIA had grown by 65%.

Up to October this year, HKIA has reported year-onyear passenger and cargo growth of 5.6% and 6.4% respectively.

“These are most impressive figures much envied by some other international airports.”

The largest airport on the island province of Hainan, Haikou Meilan International Airport, is set to get two new terminals in the next decade.

A brand new Terminal 2 is currently being planned and is set to be completed by 2020, while a plan for a new third terminal is also under consideration.

Aéroports de Paris (ADP) subsidiary, Aéroports de Paris Ingenierie (ADPI), has designed the planned new 290,000sqm Terminal 2, which is the key project of a $136 million investment programme.

Located opposite Terminal 1, ADPI says the 18mppa capacity T2 will be designed to provide a “high level of functional and aeronautical quality”.

According to ADPI, its X-shaped design will feature South Asia’s architectural styles and boast coconut trees in lounge areas and an inner courtyard.

If built, a third terminal would raise the airport’s annual passenger capacity to 62mppa by 2040, says ADPI. Located 20 kilometres south-east of Haikou, the capital of Hainan Province, Haikou Meilan handled 11.9 million passengers in 2013.

FIVE NEW AIRPORTS The Chinese government has recently approved construction of five airports along with three rail projects worth an estimated €19.3 billion.

A commission has approved construction of five gateways spread in the north-western APA Issue 4, 2014

provinces of Qinghai and Inner Mongolia, south-western provinces of Yunnan and Guizhou and northeast Jilin Province.

The projects are the latest move to speed up infrastructure projects in order to boost

economic growth, which has dropped in China in the last few years.

Exact details of the new airport development projects have yet to be revealed, and contracts are set to be put out to tender in 2015.

ASIA-PACIFIC AIRPORTS MAGAZINE

SPECIAL REPORT: CHINA

NEW QINGDAO AIRPORT Construction of a new airport in Qingdao has been approved by the China National Development and Reform Committee (NDRC).

Atkins and China Southwest Architectural Design and Research Institute (CSWADI) won the contract for conceptual planning and terminal design for the new Qingdao Airport.

The project will see an investment of around $5.5 billion, and it will serve as a main regional hub and enhance the aviation capacity for both passengers and cargo.

The project covers all design aspects including master planning, airfield design, transport planning, landscaping and water engineering.

TIANJIN BINHAI’S NEW SHOWPIECE T2 Tianjin Binhai International Airport has been transformed by the opening of its new state-of-the-art T2, which was built to meet growing demand.

The gateway commenced the cutover of live operations from T1 to T2 on August 28, when China Southern Airlines was the first carrier to make the switch, and the remaining airlines have been making the move in a staged approach.

The newly built 248,000sqm terminal has a design capacity to handle 30 to 50 million passengers annually and features over 350 flight information display screens (FIDS) by Intersystems.

It is anticipated that Tianjin Binhai will also have T1 upgraded sometime in the near future, to further enhance the airport.

35

Qingdao, in Shandong Province, is an important economic centre and seaport along the eastern coastline and an important gateway to Northeast Asia with extensive trading relations with Japan and South Korea.

Chris Birdsong, Atkins’ CEO for Asia Pacific, says: “Our partnership with CSWADI, one of the leading design institutes in China and the largest in western China, will allow us to unlock opportunities to deliver our multidisciplinary, high-end engineering services in China.”

Upon completion in 2017, Qingdao will be able to process 38mppa in 2025 and 60mppa by 2045.

SHANGHAI SATELLITE CONCOURSE The world’s largest satellite concourse will be built at Shanghai Pudong International Airport as part of the Shanghai Airport Authority’s (SAA) bid to make it the premier international hub in Asia.

Designed by US architect Corgan, in association with Chinese partner IPPR, the complex is expected to boast 100 boarding gates when fully operational.

The concourse is needed so the airport can keep pace with the growth of China’s largest city and financial capital.

The budget for the development has yet to be announced and the SAA says it aims to welcome 80 million passengers and handle 4.7 million tonnes of cargo annually by 2020, making it Asia’s primary aviation hub.

Corgan’s concept will focus on maximising passenger flow and experience in an efficiently organised building that is designed to be “beautiful yet efficient in both its operation and maintenance”.

Jonathan Massey, principal for Corgan’s aviation design studio, says: “Our mission is to take the passenger experience to a higher level.”

Another important aspect of the design of the satellite concourse is so it can grow and change with the aviation industry and city. www.aci-apa.com

36

ASIA-PACIFIC AIRPORTS MAGAZINE

AIRLINES

Playing to its strengths Martin Rivers finds out more about the business strategy, growth and development plans of Cebu Pacific.

A

fter receiving its fourth Airbus A330-300 in May, Cebu Pacific, the Philippines’ largest airline, was understandably eager to make good on its promise of rolling out long-haul destinations.

The low-cost carrier began operations in 1996 and has historically focused on domestic connectivity across the archipelago plus regional links throughout Asia.

But under the stewardship of Lance Gokongwei, the son of founder and business magnate John Gokongwei, Cebu Pacific has steadily encroached into the challenging yet ever more popular sphere of low-cost, long-haul flying.

“Our strategy on long-haul is to offer the same affordable, efficient, safe service that we do on the short-haul and regional markets,” the younger Gokongwei tells Asia-Pacific Airports . “Our focus is primarily on routes that can be served by our A330s where there is a large Filipino population.”

The first long-haul destination to enter the network was Dubai, with daily flights launched in October 2013 – four months after Cebu Pacific received its first widebody.

Although the route was initially unprofitable, load factors are now inching towards the mid-80% break-even point and further expansion in the Middle East APA Issue 4, 2014

followed this year with a launch of flights to Kuwait and Saudi Arabia (Dammam and Riyadh).

Both markets are attractive to Cebu Pacific because of their large expatriate populations – 930,000 Filipinos work in the United Arab Emirates, and 180,000 in Kuwait – but competition is stiff, with Emirates and Kuwait Airways both serving Manila’s main gateway, Ninoy Aquino International Airport.

Saudia and Philippine Airlines both fly to Dammam and Riyadh from Manila – with Saudia also operating a Jeddah-Manila service – but Gokongwei is confident that Cebu Pacific’s lower fares could catalyse higher demand for these destinations.

“The latest data says that 75% of the traffic to Saudi Arabia does not fly direct at this point. So I do think there is a gap in the market,” he says.

“If you combine the huge number of non-direct traffic with the stimulation we can provide by offering lower fares, I do think there’s enough room for the Saudi carriers, for Philippine Airlines and ourselves.”

Elsewhere, a four-times weekly service to Sydney began in September, rising to five-times weekly in December.

Although Cebu Pacific hopes to attract Australian leisure travellers on the Sydney

ASIA-PACIFIC AIRPORTS MAGAZINE

37

AIRLINES

route – previously duopolised by Qantas and Philippine Airlines – it is the country’s diaspora that will again fuel much of the low-cost demand. An estimated 250,000 ethnic Filipinos currently live in Australia.

Indeed, with almost one in ten Filipinos living or working abroad – equivalent to about 10.5 million people – labour traffic and VFR (visiting friends and relatives) traffic lie at the heart of the airline’s business strategy.

“Our fundamental brand and culture is based on the low-cost carrier model,” Gokongwei explains. “We believe that is a suitable model, especially for a country with the Philippines’ specific characteristics.

“First, the Philippines is a relatively low-income market. Second, there’s a lot of Filipino workers abroad. Philippine traffic is almost 95% worker traffic. That creates a lot of opportunity unique to Cebu Pacific for those workers, as well as friends and family who want to visit them.

“Third, the rapid economic growth in the Philippines has also created an emerging middle class, especially IT and BPO (business process outsourcing) workers, who now have incomes and want to travel.”

The airline also launched direct A320 flights to Tokyo this year.

The new additions mean that Cebu Pacific now serves 27 domestic and international destinations from its Mactan-Cebu International Airport hub.

Cebu Pacific’s domestic footprint encompasses 34 destinations, while its

regional network comprises 23 cities spread across 11 foreign countries. Both sectors will continue to expand, with Tandag in Surigao del Sur becoming the latest addition inside of the Philippines’ borders.

Cebu Pacific completed its acquisition of loss-making subsidiary Tigerair Philippines in March, lifting its overall domestic market share to 60%. As well as bolstering its presence at home, the deal opens up the potential for a metal-neutral agreement with the Tigerair parent in Singapore.

“We fly into North Asia, into China, Korea, Japan, whereas Tiger has real strength going into a lot of Southeast Asian countries: Indonesia, Thailand, Malaysia and particularly into India,” Gokongwei notes.

“We are already selling each other’s tickets on each other’s sites. Now for the routes between the Philippines and Singapore, we are going through the various competition regulators to seek a revenue sharing model.”

Instead, Cebu Pacific will keep its focus firmly on the Philippines, cementing its first-mover advantage in the rapidly consolidating market.

The CEO is careful not to overstate his appetite for foreign partnerships, however, stressing that Cebu Pacific has little interest in joint ventures.

“I don’t want to be the fourth or fifth entrant into the market,” he explains when APA quizzed about the issue. www.aci-apa.com

ASIA-PACIFIC AIRPORTS MAGAZINE

39

IT TRENDS

Putting people first The 2014 Airport IT Trends Survey reveals that China’s airports are increasingly focusing on the passenger experience.

T

o support the massive growth in traffic across China, the nation’s airports are investing in new infrastructure and technology, and from an IT perspective, passenger processing tops the agenda, according to the latest Airport IT Trends Survey.

The annual survey, conducted by SITA in partnership with ACI, reveals that 53% of China’s gateways cite passenger processing as their highest IT priority, followed by security and airport operations.

SELF-SERVICE AND COMMON-USE

The shift of focus from operations to passengers is noticeable in the choice of investment projects, with 65% of airports

having major programmes and a further 29% running pilot projects related to self-service.

New self-service options are also being introduced to improve passenger handling, such as bag-tag printing, selfboarding and bag-drop.

Today, 65% of airports can offer bag-tag printing, up from 46% in 2013, while self boarding is available at 35% of leading airports in China, a jump from 8% last year.

Chinese airports continue to increase the number of common-use kiosks available to passengers. 35% of leading Chinese airports plan to add more kiosks for check-in, while 35% are planning to install them for other uses (up from 29% in 2013). www.aci-apa.com

40

ASIA-PACIFIC AIRPORTS MAGAZINE

IT TRENDS NEW SERVICES

Airports in China are embracing new social trends, such as mobile and social media, driven by Generation Y consumers.

In fact, in 2014 every airport surveyed had a major investment or an evaluation project related to passenger services via mobile and social media.

Behind the investments is a strong desire to develop a more personalised customer service through direct interaction, and a majority of airports (53%) rate their social media investments against this criteria as performing well or above expectations.

In particular, Chinese airports are using mobile and social media to communicate with passengers in times of disruption. By the end of 2017, 94% of airports in China will have implemented real-time notification via social media and mobile.

GLOBAL TRENDS

China is certainly not alone in its ambition to improve passenger processing at airports, as the survey found that it is the leading IT APA Issue 4, 2014

priority of airports around the world.

According to the survey, nearly half (47%) of the world’s airports rank passenger and airport security as their top IT priority.

Indeed, the annual airport survey shows the focus on the ‘connected traveller’, with investments in IT infrastructure and services that give passengers more convenience, control and a connected experience.

It claims that self-service and mobile options are key areas of investment, with more than 80% of airports planning a project in these areas over the next three years.

The good news for passengers is that airports also have more money to invest in IT: 63% of CIOs expect to spend more on technology in absolute terms in 2014 compared to last year, and their total spend is estimated to reach $6.8 billion.

THE CONNECTED TRAVELLER

Francesco Violante, CEO SITA, says: “This is the age of the connected traveller with nearly all passengers carrying mobiles, tablets and other devices. It is vital that airports invest in the infrastructure to support the changing expectations of these passengers.

“This year’s survey shows that the majority of airports globally are investing more in new technologies and mobile services for

ASIA-PACIFIC AIRPORTS MAGAZINE

passengers in an effort to improve passenger processes and satisfaction.�

According to the survey, airports continue to invest in self-service to help manage growing passenger numbers.

SELF-SERVICE TECHNOLOGY

Over the next three years, more multiservice kiosks, self-bag drop and selfboarding services will be at airports around the world as 86% of airports plan investments in this area.

And it claims that by 2017, nearly three-quarters of airports expect the majority of their passengers to use self-service check-in. Common-use kiosks continue to be popular, with 60% of airports planning to increase their numbers for check-in and other uses.

Geo-location technology, which allows an airport to provide services in relation to where the passenger or staff is at a particular time, is one of the initiatives popular with airports; 60% plan geo-location programmes over the next three years.

SOCIAL MEDIA

Mobile is going to take hold in other areas, too. By 2017 the vast majority of airports plan to expand services through mobile apps including customer relationship management (CRM) (78%), wayfinding (72%), security wait time notifications (73%) and retail services (65%).

For the connected traveller, airports will increasingly offer CRM via social media. Already 30% do so, but this is set to jump to 70% over the next three years.

Overall, the performance in social media for airports is mixed. Of those airports that measure social media usage, 13% have found that it has exceeded their expectations while nearly 18% report passenger usage figures lower than expected.

The survey is based on responses from participants at airports that between them accounted for 2.35 billion passengers or 42% of the total global passenger traffic last year.

APA www.aci-apa.com

IT TRENDS

NEW INNOVATIONS

Newer innovations have caught the eye of some airports, too, with 49% investing in near field communications (NFC), 33% planning iBeacon programmes and 16% investigating wearable technologies during the same period.

But it is the airports in Europe that are embracing these innovations the most. By 2017, 76% of them plan programmes with geo-location, 55% with NFC and 23% with iBeacons.

Mobile investments continue to be a major part of airport IT strategies, with 84% investing in mobile applications for passenger services over the next three years.

The most common mobile service currently available is flight status notifications, with 50% of airports offering it now and 90% planning to offer it within the next three years.

41

42

ASIA-PACIFIC AIRPORTS MAGAZINE

CONSTRUCTION NEWS

DESIGN & BUILD

Suvarnabhumi International Airport.

T

hailand’s government has confirmed that the secondphase expansion of Bangkok’s Suvarnabhumi Airport will go ahead as planned, only with a slightly reduced budget of $1.6 billion.

Set to be completed by early 2017, the master plan will boost the airport’s design capacity from 45 mppa to in excess of 65mppa.

Its key projects include a third runway and a new 28-gate satellite concourse capable of accommodating aircraft up to the size of the A380.

The 216,000sqm complex – which necessitates the addition of another one million square metres of apron – will be located 800 metres south of the main terminal building and be linked by an Automated People Mover (APM) and baggage handling system via a tunnel under the airfield.

According to architects HOK, the new concourse will boast similar curved, arched windows to the existing terminal APA Issue 4, 2014

complex and is designed to be easily constructed and energy efficient.

It states: “The concourse will be a natural extension of the existing terminal with a spatial quality that is enhanced by the use of natural lighting and tropical gardens that bring greenery and light deep into the concourse. The use of warm materials and design elements will also give a sense of Thai-ness.

“Along with a mezzanine-level concessions area with a view of the airfield and ample retail throughout the concourse, the new addition to the airport will provide a refreshed level of convenience and comfort for international travellers.”

Other major developments include an easterly extension to the existing main terminal, additional car parking, new airline offices and support facilities such as a cogeneration power plant and water treatment station.

Airports of Thailand (AoT) wants to open the new midfield concourse as soon as possible, as more than 50 million passengers

ASIA-PACIFIC AIRPORTS MAGAZINE

43

CONSTRUCTION NEWS

The new satellite concourse will be similar in design to Suvarnabhumi’s distinct main terminal building.

passed through Suvarnabhumi in 2013 and, despite recent political unrest in the country, traffic growth shows no sign of slowing down.

CUSTOMER SERVICE

It also believes that the new capacityenhancing facility will take customer service levels and operational efficiency at Suvarnabhumi to new heights.

An AoT spokesman says: “Suvarnabhumi was created to be the best airport in Asia, and this goal is all encompassing. We want to offer the best in everything, and have a strong emphasis on passenger services, security and energy efficiency.

“We have an attractive, environmentally friendly airport, but we currently don’t have the capacity to meet future demand. The statistics show that the airport will reach its capacity in the next few years. This effectively means that Suvarnabhumi won’t be able to meet our goals until the new facilities are added.”

If all goes to plan – Thailand’s Ministry of Transport has yet to approve it – proposals to

KEY FACTS LOCATION: PROJECT:

DELIVERY DATE: CONTRACTORS:

Bangkok, Thailand New satellite concourse, third runway, additional car parking and support facilities 2017 HOK; NACO; MAA Consultants & Design; Design 103 International; BNP; Wise Projects Consulting Ltd; Louis Berger Group (as a sub-consultant to ICAO).

expand the gateway will be submitted in December, with construction work expected to start in the final quarter of 2015.

AoT’s chairman of the board, Prasong Poontaneat, notes that the airport operator will fund the projects itself and therefore does not need to approach any financial institutions for assistance.

Ambitious AoT is also expanding Phuket International Airport and renovating Bangkok’s Don Mueang to increase its capacity from 18mppa to around 30 million. www.aci-apa.com

44

ASIA-PACIFIC AIRPORTS MAGAZINE

CONSTRUCTION NEWS Newcastle Airport.

I

n September 2013, Newcastle Airport received long-awaited news – its application to the New South Wales (NSW) government for an A$11.1 million grant to fund the expansion of its terminal had been successful.

Fast-forward 14 months and construction of the 2,600sqm extension is well underway as part of a A$14.5 million project that will also involve a complete refurbishment of the existing facilities.

Located in Australia’s Hunter Region around a two-hour drive north of Sydney, Newcastle Airport (NTL) serves a catchment of 1.1 million people in an area that is best known for its local wineries and beaches.

Newcastle also has a busy port, indeed more coal is exported through it than any other in the world. And, according to David Nye, the airport’s manager for aviation business development, NTL serves as the gateway to a diverse tourism offering that includes “world-class beaches, the largest lake in the southern hemisphere and the internationally renowned Hunter Valley Wine region”.

The region’s appeal ensures that it handles around 1.2 million passengers annually and currently boasts domestic services to Sydney, Melbourne and the Australian Eastern Seaboard cities/destinations of Brisbane, the Gold Coast, Ballina/Byron Bay and Taree.

According to Nye, the expanded terminal will continue to facilitate the needs of NTL’s low-cost carriers, principally Jetstar and Virgin Australia, which are the two biggest airlines in Newcastle in terms of market share.

APA Issue 4, 2014

KEY FACTS LOCATION:

Newcastle, Australia

PROJECT:

Terminal expansion

DELIVERY DATE: Mid-2015 CONTRACTORS: Hansen Yuncken Construction,

Point Project Management,

Schreiber Hamilton Architects

Added in the first phase of a two-phase development programme, the 2,600sqm extension to the terminal will become the airport’s new Arrivals Hall and house permanent customs, immigration and quarantine facilities.

Once the extension is complete, the airport will start work on refurbishing the existing terminal, a project that will include transforming the current Arrivals Hall into a new-look departure lounge, which will incorporate more than twice the number of retail outlets as today.

“For a regional airport, this is a significant investment into our facilities, but we do so with confidence because in the past decade people across our region have shown their desire to travel and take advantage of the services being offered at their local airport,” says Nye. “Our end goal is to ensure that we build a facility that provides us with flexibility and will allow us to grow both domestic and international services.

“By the end of 2015, I am confident that passengers will consider our facilities and services amongst the best in Australia. I am also confident that by this time next year we will have, or be very close to having, scheduled international services operating APA from our region.”

46

ASIA-PACIFIC AIRPORTS MAGAZINE

ENVIRONMENT NEWS

ENVIRO REPORT

Asia-Pacific Airports reviews the latest ‘green’ initiatives from across the region.

Regional director Patti Chau and Adelaide Airport’s Stephanie Bolt.

A

CI’s Airport Carbon Accreditation scheme continues to gather pace in the Asia-Pacific region, with Jakarta’s Soekarno-Hatta International Airport and Chiang Mai in Thailand among the latest gateways to be recognised for their efforts to reduce CO2 emissions.

Chiang Mai was in fact one of four Thai airports to be presented with Airport Carbon Accreditation certificates at ACI Asia-Pacific’s Small and Emerging Airports Seminar in Bali last week.

The other three accredited Thai airports are Bangkok’s Don Mueang; Hat Yai; and Mae Fah APA Issue 4, 2014

Luang Chiang Rai, all of which have been accredited at the scheme’s ‘Mapping’ Level 1.

“I wish to congratulate the airport operators of the five newly accredited airports, PT (Persero) Angkasa Pura II and Airports of Thailand for their efforts in carbon management and commitment to operating their airports in an environmentally sustainable manner,” enthused ACI Asia-Pacific’s regional director, Patti Chau.

“The programme has really engaged and motivated airports across our region and in just three years 21 have become accredited [see listing right].

ASIA-PACIFIC AIRPORTS MAGAZINE

AIRPORT CARBON ACCREDITATION PIONEERS LEVEL 3: OPTIMISATION • Hong Kong International Airport, Hong Kong • Incheon Airport, Republic of Korea • Delhi–Indira Gandhi International Airport, India • Bengaluru–Kempegowda International Airport, India • Hyderabad–Rajiv Gandhi International Airport, India

LEVEL 2: REDUCTION • Adelaide Airport, Australia • Mumbai–Chhatrapati Shivaji International Airport, India • Kaohsiung International Airport, Taiwan • Macau International Airport, Macau • Parafield Airport, Australia • Sunshine Coast Airport, Australia • Bangkok Suvarnabhumi Airport, Thailand

LEVEL 1: MAPPING • Abu Dhabi International Airport, United Arab Emirates • Chiang Mai International Airport, Thailand • Bangkok–Don Mueang International Airport, Thailand • Hat Yai International Airport, Thailand • Mae Fah Luang-Chiang Rai International Airport, Thailand • Queen Alia International Airport, Jordan • Sharjah International Airport, United Arab Emirates • Jakarta Soekarno-Hatta International Airport, Indonesia • Sydney Airport, Australia

www.aci-apa.com

ENVIRONMENT NEWS

“As well as welcoming new airports into the programme, we look forward to witnessing accredited airports move up through the levels of the programme. Together we will create a low-carbon airport industry.”

Airport Carbon Accreditation was first launched by ACI Europe in 2009 and later extended to Asia-Pacific, Africa and most recently to North America and Latin-America & Caribbean.

Indeed, Mexico’s Puerto Vallarta International Airport become the 111th gateway and the first in Latin America & Caribbean to be accredited under the scheme in November.

The addition of ACI-NA and ACI-LAC mean that the programme is now fully global for the first time, as it includes airports from all five continents.

Chau enthuses: “We are delighted to see Airport Carbon Accreditation become available to members of ACI-LAC today. It’s a big moment for the programme, as it demonstrates the momentum that the airport industry’s climate change commitment has gained over the past seven years and that the demand for this kind of tool is now genuinely global.”

She adds: “A significant part of the global airport industry is actively addressing its carbon emissions – and they have mobilised on this, of their accord. They are proactively reporting on their carbon reduction activities every year and the number of airports is constantly growing too.

“An impressive 1.48 billion air passengers now travel through airports certified at one of the four levels of the programme.”

The programme is institutionally endorsed

by ECAC (European Civil Aviation Conference) and EUROCONTROL and is overseen by an independent Advisory Board including representatives of the European Commission, ECAC, EUROCONTROL, ICAO (International Civil Aviation Organisation), UNEP (United Nations Environmental Programme) and Manchester Metropolitan University.

The programme now comprises 109 airports currently certified at one of the four available levels of certification (‘Mapping’, ‘Reduction’, ‘Optimisation’ and ‘Neutrality’), including some of the best-known and most APA renowned airport brands in the world.

47

48

ASIA-PACIFIC AIRPORTS MAGAZINE

DESTINATION REPORT: SARAWAK

Beautiful

BORNEO Tourism chief, Dato Rashid Khan, tells Asia-Pacific Airports about Sarawak’s five-year air service development plan.

B

orneo: the word conjures up images of traditional warriors, rainforest, mountains and, of course, those endangered orang-utans.

The island is renowned for its biodiversity and rich culture and heritage, but now the Sarawak Tourism Board is aiming to increase air services and tourist numbers, while maintaining the destination’s pristine nature.

Borneo is relatively well known by high-end tourists and adventure seekers in regions such as South East Asia, Europe and Australia, but because it is an island, getting there hasn’t always been that easy.

Kuching, the capital of the Malaysian state Sarawak, which shares borders with Brunei and Indonesia, has good connections to Kuala Lumpur with the likes of Malaysia Airlines and AirAsia.

In recent years, however, its tourism authority has set out to increase the number of direct flights from the city from other regional hubs and to leverage airline partnerships more.

APA Issue 4, 2014

FIVE-YEAR PLAN

Sarawak Tourism Board launched its five-year air services transformation plan in 2011 in a bid to increase air accessibility to Kuching.

Its CEO, Dato Rashid Khan, told APA the air services strategy is a core part of the organisation’s efforts.

“One of our biggest issues has been accessibility. We are the third largest island in the world and we need air connectivity as a key fundamental to transform our tourism industry,” he says.

“People can’t swim to the island, so we have undertaken to transform our tourism industry with air accessibility as the key pillar,” Khan adds.

The plan prioritises working with carriers flying from Kuching to the likes of KLIA, Singapore, Brunei and Kota Kinabalu on better scheduling and connections.

“We already had airlines flying here from those major connecting points, but our strategy called for more tolerable transit times through those airports,” he explains.

ASIA-PACIFIC AIRPORTS MAGAZINE

49

DESTINATION REPORT: SARAWAK

The next phase will see the organisation working with airlines and their codeshare partners, in an effort to get the Kuching code in more of the GDSs. “This will link Kuching to the world,” Khan states.

TRAFFIC TRENDS

Without doubt hosting Routes Asia earlier this year provided the perfect opportunity for Kuching and Sarawak to showcase its appeal to airline network planners ahead of the ASEAN community moving towards greater aviation liberalisation in 2015.

In terms of route development, Khan has no hesitation in admitting that the Sarawak Tourism Board is targeting countries like Taiwan, Korea, Japan and China, citing the A320 and B787 as “ideal aircraft” to operate the sectors.

With Asia-Pacific’s low-cost carrier revolution marching on, he adds that the tourism authority is also working hard on attracting more no-frills services.

“We’ve had a good response from the LCCs – they are very robust in their planning.

When we engage with them, they often develop new city pairs within Malaysia or the rest of the region,” he says.

“We are currently in discussions with a few LCCs in Hong Kong and China. They are looking for new business opportunities.”

And while Sarawak might be a tourism hotspot, there is also growing business traffic due to the Sarawak Corridor of Renewable Energy.

This is a 70,000sqkm resource-rich area with a population of 600,000 and renewable resources like hydropower.

TOURISM SNAPSHOT

But just what exactly can Sarawak offer visitors?

Its tourism industry and products are focused on nature and culture, with 28 tribes being native to Sarawak.

“We position Sarawak as an adventure product experience – it is mainly nature based products, which is natural with our 17 national parks.” www.aci-apa.com

50

ASIA-PACIFIC AIRPORTS MAGAZINE

DESTINATION REPORT: SARAWAK A bridge too far? All images courtesy of Kirkland Photos for Sarawak Tourism Board.

Activities such as rafting and kayaking are popular, while ‘culinary adventure’ is growing in popularity with the “very different foods in the jungle of Borneo”, proving popular with tourists, says Khan.

In 2013, Sarawak welcomed more than three million tourist arrivals between January and September, a 6% growth on the same period last year. According to Khan, about 40% of arrivals are international, with the 60% majority being made up of Malaysian visitors.

In total, Malaysia welcomed 12.6 million tourists in the first half of 2013 and the country is aiming to boost that to 36 million by 2020.

BIGGEST MARKETS

In terms of markets, Sarawak Tourism Board is particularly focused on the UK, Germany and Belgium, says Khan. He says it already records “substantial numbers of visitors” who connect via Kuala Lumpur or Singapore.

Khan also points to growing numbers of Chinese tourists who tend to travel to Sarawak with charter operators.

He says the tourism board has been particularly active with working with APA Issue 4, 2014

Chinese tour operators or travel companies from other over-populated cities.

“We are engaging with operators especially from the large cities in urban areas – we can put those people back into nature and the fresh air,” enthuses Khan.

While domestic tourists make up the bulk of Sarawak’s visitors, in South East Asia, Indonesia, Brunei and the Philippines are the biggest markets.

SPREADING THE WORD

Sarawak has also prioritised major events as a key pillar in growing visitation and awareness, holding 13 this year including Routes Asia and the ASEAN Tourism Forum.

While those two events have attracted tourism and aviation leaders from across the Asia-Pacific region, the annual Rainforest World Music Festival is an internationally renowned event that attracts thousands of visitors and journalists from all over the world.

With the tourism board prioritising events and air services in the years ahead, Sarawak looks set to cement its position as one of South East Asia’s leading destinations.

APA

NEW! for 2015:

Presented in Partnership by:

Inaugural ACI-World Bank Annual Aviation Symposium

ACI World ACI Europe ACI Asia-Pacific

Supporting Organisation:

$&, 7+ $118$/ $,53257

&21)(5(1&( (;+,%,7,21

Join us in London at the world’s premier airport economics forum

REGISTER NOW! Save 10% with the Early Bird rate

FEBRUARY 25–27,2015 LANCASTER LONDON HOTEL

Gala Dinner Sponsor

Airport Host

Gold Sponsors

Platinum Sponsors

Organiser

Media Partners

;OL THNHaPUL VM [OL (PYWVY[Z *V\UJPS 0U[LYUH[PVUHS

www.aci-economics.com

52

ASIA-PACIFIC AIRPORTS MAGAZINE

WBP NEWS

WORLD BUSINESS PARTNERS

IN THE SPOTLIGHT AUSSIE RULES Investec Australia Limited has invested in the Australian-based airport technology firm ICM Airport Technics, and predicts widespread adoption of its ‘auto bag drop’ check-in technology at the world’s airports over the next decade.

ICM’s self-service bag-drop solution is already in use at Qantas domestic terminals in Australia, and has over 100 units installed in 14 terminals globally.

London Heathrow and CDG and Orly in Paris will shortly be added to its list of international airports.

Head of aviation finance for Investec in Asia, Sydney-based David Phillips, says: “We already participate in the aviation sector

WINNING FEELING Hong Kong Air Cargo Terminals Limited (Hactl) was named Ground Handler of the Year for the third year running at the Payload Asia Awards 2014.

Subsidiary, Hacis, won the Regional Logistics Provider of the Year Award. Speaking after the awards, Hactl chief executive and chairman of Hacis, Mark Whitehead, said: “For Hactl, despite the many challenges in handling both globally and in Hong Kong, we have remained resolute in our aim to drive the highest possible standards. This award is thanks to the loyal and hard-working staff whose daily dedication keeps Hactl at the forefront of its industry.”

APA Issue 4, 2014

principally through our aircraft finance business and saw this as an opportunity to take additional exposure by investing in ICM given its market-leading technology and its existing strong market position.

“We expect auto bag drop technology to become a central part of airport infrastructure as the market transitions to widespread acceptance and adoption.”

The terms of the deal provide for Investec to provide financing capital to assist in new growth opportunities with an option for Investec to convert its financing into a controlling stake in the company.

ASIA-PACIFIC AIRPORTS MAGAZINE

NEW AUSTRALIAN AIRPORT EQUIPPED WITH INTERSYSTEMS’ FIDS TECHNOLOGY Australia’s first new airport in 50 years, Brisbane West Wellcamp Airport, boasts a flight information display system (FIDS) supplied

by Queensland firm, Intersystems.

The Toowoomba located airport, which opened in mid November, uses the company’s RapidFIDS and RapidADS systems.

Intersystems CEO, Bruce Allen, says: “The Brisbane West Wellcamp project was important for us to secure because of its uniqueness in the Australian context and its proximity to our head office.

“The airport is undoubtedly a key infrastructure asset for Toowoomba, Queensland and Australia as a whole.”

The A$100-million-plus airport features a terminal with extensive retail space, a 2.87 kilometre runway and business park.

RENOVATED LOUNGE OPENS AT ABU DHABI’S TERMINAL 1 Abu Dhabi International Airport, in co-operation with Plaza Premium Lounge Management Limited (PPLML) has opened its newly renovated Al Reem in T1.

The 4,500 square feet lounge the firm says is based on the concept of “providing comfort and convenience to travellers and aims to deliver an ambience o f luxury while providing a home away from home”.

The lounge spans three floors and offers Arabic, Asian and continental

cuisines made daily in the state-of-the-art kitchens, while free Wi-Fi and laptops upon request are available for those wanting to catch up on some work in between destinations.

Mohammed Al Bulooki, chief commercial officer of Abu Dhabi Airports, says: “Abu Dhabi Airports chooses to partner with the private sector’s best concessionaires in order to offer passengers a world-class experience when travelling through Abu Dhabi International Airport.”

L & B Worldwide Australia Pty Ltd. Contact: Gary Gibb Address: 255 Cremorne Street, Cremorne Victoria, 3121 Melbourne, Australia Tel: +61 3 9428 5787 Email: ggibb@landrum-brown.com Website: www.landrum-brown.com For over 60 years Landrum & Brown (L&B) has been an internationally recognised leader in the specialised field of airport planning and aviation consulting. Founded in the USA, over 55% of L&B’s business is now based outside of America, demonstrating a deliberate strategy to build a strong presence and to service clients’ needs in the growth markets of Asia and the Middle East. L&B offers services under three primary categories: Airport Planning, Environmental Services and Airport Forecasting and Financial Services.

IBS Software Services Private Ltd Contact: Joben Panakar Address: 8th Floor, A Block, Brigade Tech Park, Whitefield Road Bangalore, 560066, India Tel: +91 80 67072000 Email: vijay.chakravarthy@ibsplc.com Website: www.ibsplc.com IBS is a leading global provider of new generation IT solutions to the travel, transportation and logistics industries. A specialist in the domain, IBS offers a range of products and services that manage missioncritical operations of airlines and airports that help them increase safety, maximise efficiency, improve revenue, manage growth and reduce costs. IBS operates from 10 business centres in the Americas, Europe, Asia-Pacific and Middle East & Africa. www.aci-apa.com

WBP NEWS

WBP PROFILES

53

54

ASIA-PACIFIC AIRPORTS MAGAZINE

FINAL WORD POINTS OF VIEW

Points of view

Nok Air CEO, Patee Sarasin, shares his views on the Thai aviation market, airport development and the 2015 launch of new joint venture NokScoot.

FACT BOX

NAME:

PATEE SARASIN

JOB TITLE:

CEO, Nok Air

NATIONALITY: Thai BEST KNOWN FOR:

Being the CEO and face of Nok Air

LITTLE KNOWN FACT:

He is also a talented musician and wrote the soundtrack for a hit TV series in Thailand

NokScoot – how did the joint venture come about?

What is your philosophy on dedicated low-cost carrier terminals?

What are your network plans for NokScoot?

What is Nok Air’s fleet mix?

The JV with Scoot came about through the common interest of both airlines to expand and grow in the region through the launch of a low-cost carrier for long-haul flights.

NokScoot’s network plan will be primarily focused on North Asia from Bangkok Don Mueang to meet the demands of capacity for both markets.

Which routes are you initially looking at operating?

Our initial focus will be Japan, as there is a high demand for both outbound and inbound flights.

Why Don Mueang and not Suvarnabhumi airport in Bangkok?

Don Mueang is the perfect airport for us as it is conveniently located in downtown Bangkok.

Another advantage is that there is less congestion, meaning passengers have a more comfortable and convenient travel experience.

APA Issue 3, 2014

Having dedicated low-cost terminals will definitely improve operations for the carrier, as well as for passengers. This would definitely be an advantage for both parties.

We operate a fleet of B737-800s and ATR 72-500s. We have eight B737-800s, seven B737 MAX 8s and four Bombardier Q400s on order.

Can aviation ever be environmentally friendly?

It can be, and being environmentally friendly is what we are striving for with our operations at Nok Air. By using technologically advanced aircraft to reduce emissions as well as other initiatives in the company, we are putting all our efforts into preserving the environment.

What is your favourite airport?

Hands down my favourite is Incheon International Airport. I transit there quite often and always find the facilities and services useful. There’s always something for you to do, making a long layover seem much shorter than it actually is.